Islamabad: Pakistan and its close ally Turkey on Friday signed a preferential trade deal to open up market access worth $7.5 billion for Pakistani goods, a deal hailed by Islamabad as “a big moment and a milestone in bilateral relations”.
The Trade in Goods Agreement was signed by Pakistani Trade Minister Syed Naveed Qamar and Turkish Trade Minister Mehmet Mus in a ceremony held at the Prime Minister’s office here.
According to a statement, the agreement is an important breakthrough in improving economic relations between the two countries.
Under the agreement, Pakistani exporters will have access to Turkey’s market in 261 tariff lines covering both agriculture and industrial sector, he said.
Turkey’s import market in sectors covered by the deal stands at $7.6 billion, highlighting the significant potential for Pakistani exporters to increase their market share, he said.
Pakistan already exports USD 5.1 billion to other countries in products covered by the Pakistan-Turkey Trade in Goods Agreement and it is important that exporters use the concession provided by the agreement and increase their exports to Turkey.
The signing of this agreement will increase the competitiveness of Pakistani exporters and provide them with better market access compared to regional competitors.
Prime Minister Shehbaz Sharif, who was present at the signing ceremony, called the agreement a big moment and a milestone in historic Pakistan-Turkey relations.
Earlier in the negotiations, the Ministry of Commerce carried out extensive consultations with the private sector to ensure that the contribution of domestic industry is incorporated and reflected in the agreement.
The trade deal was the key agenda during Prime Minister Shahbaz Sharif’s recent visit to Turkey in May this year, when the leaders of both countries expressed their strong interest in accelerating and concluding the negotiations by July. 2022.
Prime Minister Sharif commended Trade Minister Qamar for his excellent leadership in securing the deal and commended the efforts of Pakistan Trade Ministry and Turkiye Trade Ministry who also worked swiftly on their side on the instructions of the President of Turkiye Recep Tayip Erdogan.
Minister Qamar hoped that the agreement would not only pave the way for increased trade and investment between the two countries, but also strengthen the already existing friendly ties.
Pakistan’s merchandise exports in fiscal year 2022 reached an all-time high of USD 31.76 billion and it is a key policy objective of the Ministry of Commerce to promote sustainable export growth through improved market access and an effective domestic policy.
Cash-strapped Pakistan could face a serious economic problem as its foreign exchange reserves are rapidly depleting amid rising external debt servicing.
The country faces a serious external threat as the State Bank of Pakistan’s foreign exchange reserves fell into single digits despite an inflow of $2.3 billion from China late last month, it said. reported the Dawn newspaper last month.
Pakistan faces growing economic challenges, with high inflation, dwindling foreign exchange reserves, a growing current account deficit and a depreciating currency.
With the current account deficit increasing to $13.2 billion in the first nine months and pressing demands for repayment of external loans, Pakistan needed $9-12 billion in financial assistance until in June 2022 to avoid further depletion of foreign exchange reserves.
